Huntsman Group Q2 Results: Revenue 1.574 Billion, Net Profit Increased By 16%, But Profit Margin Declined

Huntsman Group recently announced its financial results for the second quarter of 2024: The Group achieved operating income of $1.574 billion. Net income reached $22 million, up from $19 million in the same period last year. However, the EBITDA margin before interest, tax, depreciation and amortization (EBITDA) was $131 million, down from the same period last year.

The Group's continuing operations generated net cash of $55 million. Free cash flow was $5 million, compared to negative cash flow of $11 million in the same period last year. Revenue was flat at $1.574 billion. Net income was $22 million compared to $19 million in the same period last year; Diluted earnings per share were $0.13, compared to $0.11 in the same period last year. Adjusted net income of $24 million compared to $39 million in the same period last year; Adjusted diluted earnings per share were $0.14, compared to $0.22 in the same period last year. Adjusted EBITDA was $131 million, compared to $156 million in the same period last year. Net cash generated from continuing operations was $55 million. Free cash flow was $5 million, compared to negative cash flow of $11 million in the same period last year.

Peter R. Huntsman, Chairman, President and Chief Executive Officer of Huntsman Group, said, "Our results for the second quarter of 2024 were in line with our expectations. Adjusted EBITDA increased $50 million compared to the first quarter. Our sales volume was up 9% year-over-year and we expect year-over-year growth to continue in the second half. That said, we do not expect global economic activity to change much from current levels for the remainder of the third quarter. We will continue to control costs at a higher overall utilization rate, focus on cash flow, and achieve higher sales than the previous year. Our balance sheet is strong and we will continue to exercise tight control over capital allocations to strengthen the company for the long term and to reward shareholders."

The year-on-year performance analysis of each department is as follows:

Polyurethane Division:

During the quarter, Polyurethanes segment revenue declined year-over-year, primarily due to lower average selling prices at MDI, which was partially offset by higher volume. The main reason for the decline in the average selling price of MDI products is unfavorable supply and demand dynamics. The increase was due to slightly improved demand and increased market share in selected markets. This segment's adjusted EBITDA decreased primarily due to lower MDI average selling prices and lower equity earnings from Huntsman's minority joint venture in China, which were partially offset by lower raw material costs and increased volume.

Functional Products Division:

During the quarter, revenue in the Functional Products segment declined year-over-year, primarily due to lower average selling prices, which were partially offset by higher volume. The decline in the average selling price was mainly due to competitive pressures in the market, particularly in Europe and the Americas. The increase in sales volume was mainly due to improved demand in the industrial segment, as well as increased demand in the coatings, adhesives and lubricants markets. The segment's adjusted EBITDA decreased primarily due to lower average selling prices and higher fixed costs, which were partially offset by higher volumes and lower raw material costs.

Advanced Materials Division:

During the quarter, revenues in the Advanced Materials segment decreased year-over-year, primarily due to lower average selling prices, which were partially offset by higher volumes. The decrease in average selling price was mainly due to the unsatisfactory product sales mix. However, sales in the aerospace and infrastructure market increased, driven by the market recovery. The segment's adjusted EBITDA increased primarily due to favorable variable margins from lower raw material costs, which were partially offset by increased fixed costs.